Insurers have again called for an end to the practise of referral fees – details of potential personal injury customers being passed to law firms – following the further increases to car cover costs that have occurred as a result.

The government themselves have recently announced that they are to attempt to tighten the rules in civil litigation to try and reduce the number of personal accident claims that are currently being made through solicitors that offer the ‘no-win, no-fee’ system.

Kenneth Clarke, current Justice Secretary made the proposition that claimants would have to pay the lawyer’s ‘success’ fee with their own funds as opposed to taking them from the defendant.  Mr Clarke noted that he expected this to lead to a decrease in the number of people using the litigation route following any accident.  

If the new changes are made, it would be the first significant chance to this area of law since Labour authorised the recovery of success fees from defendants back in their 1999 Access To Justice Act

Whilst this has come as good news to many motoring insurers, the Association of British Insurers has actually requested an outright ban on these referrals, with the latest figures showing that nearly 14 million adults have received a text message from a claims company stating that they might be owed compensation resulting from an accident.

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